South–South FDI and Development in East Asia

Abstract

This paper attempts to measure the size of South–South foreign direct investment (FDI) in developing East Asia and the trends in it, the characteristics of the investing countries, and the investments themselves. It also summarizes the findings of studies in individual countries of the effects of these investments. The studies of individual countries will be used to try to find some consensus on differences between South–South FDI and North–South FDI. Among the comparisons of the two types of FDI summarized are findings about their industrial composition; their effects on their host countries and their host-country firms’ productivity, wages, and employment; and how these differ across industries.

Keywords: remittances, expenditure patterns, propensity score matching, Tajikistan, FDI, East Asia, South-South, Economic development, Intra-industry trade, Economic integration, Grubel and Lloyd index

JEL Classification: F21, F23, O19